Mutant Frog Travelogue :: All posts (c) by author

Month: June 2009

I’m on my way out the door for a personal trip that will take me around Hokkaido, so I apologize for writing and posting in haste with what may contain a few leaps of logic and clerical errors, but I saw an article by Business Insider on Japan’s “bizarre new mortgage crisis” (with an inexplicable photo of a crazy Japanese female zombie). The post covers an issue with mortgages that I recently saw profiled in an NHK mini-documentary:

With the onset of the recession, Japanese companies have exercised their option to reduce or even cancel bonuses, and for the past month the media has been buzzing with a new term — June crisis — to describe the situation of workers who may not be able to meet mortgage payments as a result.

June and December are bonus months, and 45 percent of Japanese people with housing loans have contracts that require them to pay larger amounts in these months than they do in other months, in some cases as much as five times.

Publications and TV news shows have been filled with human-interest stories about people suddenly faced with the possibility of losing their homes. The Asahi Shimbun tells of a 40-year-old housewife whose husband did not receive a bonus this month and apparently won’t receive one in December either. Even worse, his salary has been cut by 20 percent. They have 20 years left on their 35-year mortgage. They pay only ¥80,000 a month toward the loan, but during each bonus month they pay ¥400,000. With one child in university and another in junior high school, they have saved very little. “When we took out our mortgage,” the woman says, “it was unthinkable that my husband’s bonus would be zero.”

Business Insider asks from someone in Japan to provide more insight, so I decided to make this post to weigh in with a minor explanation and supplemental comment. In a word, the annual salary of company workers in Japan is regularly divided into 14 month portions, not 12 months — one extra month given during the bonus seasons in the summer and winter. Accordingly, some mortgage products, especially those sold in the 80s and 90s, had extra payments during bonus months. (The trend became very unpopular in recent years and is now much more rare.) However, a problem with this is that although a worker may believe his annual salary to be his monthly amount times 14 (not 12), the bonuses of many companies are not guaranteed, although its payment has long been taken for granted, at least before the current economic crisis that has hit Japan’s exporters hard.

The only additional comment I have is that I don’t expect this to develop into a real “crisis.” Banks do not want to forclose on homes in Japan. With the collapse in housing prices over the past 20 years, lenders would not be able to fully recover on many loans if the borrowers defaulted, and even where the loans permit recourse, it still seems unlikely that banks would benefit by making people lose their homes. Perhaps thats wishful thinking, or even unrealistic, but this is a blog, so tell me in the comments if you think I’m wrong.

And on a final note, I’d always take anything I read in the Japan Times with a big, big bucket of salt — just check out the following unverified assertions using scientific journalistic terms such as “pieces of crap”:

There are more than 6 million vacant houses in Japan. Most will never be sold, because they’re pieces of crap that were never meant to outlast their 35-year mortgages. Condominiums are no better. On average, Tokyo “mansions” built in 1990, when land values peaked, were selling for half their original prices by 2004.

While I may find something to agree with in the commentary of that section, I would like to hear on what basis there are 6 million new and vacant homes, as implied. While there are lots of homes abandoned by families when elderly relatives go into homes or kick the bucket, for estate tax purposes, 6 million vacant homes sounds like unsubstantiated rubish. Certainly the fact that mansions built in 1990 are not selling at half their original price is that homes in Japan depreciate rapidly in price.

When I claimed there were no real issues at stake in the upcoming prefectural election, I may have spoken too soon. Just half a day after I posted my rundown of the election, a consumer group along with DPJ and communist assembly members marched against the moving of Tsukiji market to Toyosu.

Interestingly, we have two articles on the link between frogs and pollution, with seemingly contradictory results. First the BBC reports that the spate of deformed frogs with missing limbs, a phenomenon which had always been thought to result from man-made environmental pollution, is actually caused by predatory dragonfly nymphs that actually eat the limb-buds from tadpoles, before they develop proper limbs when they metamorphose into frogs.

And then we have this column from Nicholas Kristof, telling us that It’s Time to Learn From Frogs. And what should we learn exactly? That industrial chemicals used in agriculture or in daily household products such as hairspray act as a weak form of estrogen on the body, causing significant sexual organ deformities in embryos of various species. It is well known that frogs are particularly sensitive to environmental pollution, which is why the aforementioned missing limb phenomenon was long thought to have a chemical trigger, but the evidence is mounting that these sorts of environmental pollution are also causing a stark increase in cases of human sexual organ deformity, particularly among young boys.

I can easily imagine some reactionary “conservative” making a pseudo-scientific argument that because we recently disproved a link between industrial chemicals and missing frog legs, we might as well dismiss the second case out of hand. This would of course be a logical fallacy, as the mechanism is clear and the evidence is plentiful, not to mention relevant so far more animal species than frogs, but don’t be surprised if you see someone trying to make such a claim.

The third piece is the most interesting, as it takes on some of the strongest arguments against the new law: that it would be unduly harsh on overstayers and that it would inconvenience foreign residents.

Here’s the counter-argument on the first point:

If illegal foreigners turn themselves in, they may, under certain circumstances, be granted special permission to stay by the justice minister, or placed in custody in preparation for deportation.

The bills stipulate the justice minister must clarify the standard to grant special permission to stay to motivate overstaying foreigners to turn themselves in.

[…]

The bureau currently has no concrete criteria for granting the permit. Instead, it shows on its Web site examples of cases it granted and those it didn’t, but the information provided may not give illegal foreigners a clear clue as to what their fate may be, [Immigration Bureau General Affairs Division official Kazuyuki] Motohari said.

In one case on the Web site, a 27-year-old Southeast Asian woman was granted permission in 2007. She entered Japan with a six-month student visa in October 2004, dropped out of school and continued to stay in Japan.

She was arrested for overstaying in 2007, sent to the bureau without criminal charges and married a South American man, a legal resident, she had begun living with before the arrest. The bureau concluded their marriage was credible and she otherwise had a clean criminal record, it said on the Web site.

And on the inconvenience factor–the issue of certain changes having to be made at the immigration office rather than at city hall:

The Immigration Bureau is considering enabling foreign residents to report changes in workplace and apply for renewal of residence cards via mail or the Internet instead of requiring them to go to local immigration offices, he said.

Currently, renewing alien registration cards, which are to be replaced by zairyu cards, and reporting changes in personal information can be done at municipal offices, more of which exist than immigration offices.

For address changes, residents can go to municipal offices even under the new system. For changes in name, gender and nationality, they will have to go to immigration offices instead of municipal offices, but such changes rarely occur.

U.S. defense officials are preparing a version of the stealth F-22 Raptor that Japan has expressed strong interest in buying. While the Department of Defense is working to design an export version of the Raptor, U.S. Sen. Daniel Inouye, D-Hawaii, this week sent a letter to Japanese Ambassador the United States Ichiro Fujisaki saying that the F-22 would likely carry a price tag of $290 million. Japan has made it known it would like to buy 40 F-22s, made by Lockheed Martin and Boeing, so the potential value of the deal is more than $11 billion…

It has taken some time for U.S. and Japanese negotiators to get a deal together for the F-22. And it will take several years of development to get an export version off the ground since there is a large amount of sensitive technology that U.S. officials believe needs protection. Aviation Week estimated it would be 2017 before delivery of the first aircraft to the Japanese air self-defense force.

Japanese defense officials are reportedly looking at other aircraft, including Lockheed’s F-35 and the Eurofighter Typhoon, which is manufactured by a consortium of Alenia Aeronautica, BAE Systems and EADS. Neither have all the stealth capabilities of the Raptor, making them substantially less expensive. The Typhoon is estimated to be about $105 million per plane.

Organized crime relations are becoming a bigger and bigger deal in the world of Japanese financial regulation. Late last year, the FSA and the Japanese Bankers’ Association adopted some administrative guidelines concerning how banks should protect against yakuza, sokaiya and other rabblerousers, and many of those guidelines are being phased in this year by institutions across the country.

One measure being implemented is amending account agreements in order to allow banks to pull service from customers with criminal ties. Here is a translation of the JBA’s suggested language (original version here). It is pretty laughable even by legal Japanese standards; I wonder who had a hand in drafting it.

Article [__] (Exclusion of Anti-Social Forces)

(1) I hereby represent that I am currently not, and hereby agree that in the future I shall not become, any of the following.

1. A criminal organization (暴力団)
2. A member of a criminal organization
3. A quasi-constituent of a criminal organization
4. An enterprise related to a criminal organization
5. A sokaiya (総会屋), politically-branded racketeering organization (社会運動等標ぼうゴロ) or organized crime-related “specialist” (特殊知能暴力集団– a police term for individuals or groups who are not yakuza themselves, but help fund yakuza activities)
6. Any other person pursuant to any of the above

(2) I hereby agree that I shall not engage in any of the following acts, whether personally or through a third party.

1. Violent demands
2. Improper demands in excess of legal responsibilities
3. Acts of violence or menacing statements in relation to a transaction
4. Spreading of rumors, use of falsified statistics or use of obstruction to harm the reputation of your bank, or to obstruct the business of your bank
5. Any other act pursuant to any of the above

(3) In the event it is determined that I correspond to any of the listed items in paragraph 1 above, commit any listed act in the preceding paragraph, or have made a falsified report with regard to the representations and covenants in paragraph 1 above, and it is improper to continue transactions with me, upon the demand of your bank, I will lose the benefit of term with regard to all liabilities I have to your bank, and will promptly perform those liabilities.

(4) In the event that I have received the discounting of notes, that it is determined that I correspond to any of the listed items in paragraph 1 above, commit any listed act in the preceding paragraph, or have made a falsified report with regard to the representations and covenants in paragraph 1 above, and that it is improper to continue transactions with me, upon the demand of your bank, I will owe a liability to repay the face amount of all notes, and will promptly perform it. Until such time as this liability is performed, your bank may exercise all of its rights as the holder of such notes.

(5) Once performance of the liabilities under the preceding two paragraphs has been completed, this agreement will lose validity. (Bizarre phrasing!)

The Economist has come out with a bold argument in favor of a tough “creative destruction” policy for Japan to promote efficiency, productivity growth, and economic recovery by letting more companies fail (emphasis added):

[Japan’s long-standing “convoy” system of keeping underperforming firms alive] does enormous harm. Weak firms need to exit the market, either by going bust or being sold to another firm, or the whole business environment gets stifled. Japan has far too much capacity in many businesses—eight mobile-phone makers, for instance, few of which make much money. This squeezes prices and margins, thus denying better-run firms the surplus capital they need to hire talented people, buy competitors or invest in research and development. It also locks up resources, both human and financial, that could be used more productively by stronger firms. Before the downturn, Japanese companies’ return on equity averaged around 10%, about half the level of American firms.

Tellingly, the shut-down rate of companies in Japan is around half that in America and Britain. And the number of corporate insolvencies is expected to increase in Japan this year by only 15%, despite the depth of its recession, compared with more than 30% in western Europe and 40% in America. Normally a scarcity of corporate bankruptcies is a sign of economic vitality; in Japan, it is a sign of its economic weakness. Of course, keeping struggling firms alive protects jobs. But it also fossilises industry structures and hinders the development of a more flexible labour market and a business environment more supportive of new-company creation—two areas where Japan is also sadly deficient.

As if in direct response, an anonymous Nikkei op-ed says that letting companies fail in Japan can be dangerous by erasing critical knowledge and ruining the macroeconomy. As there is no online version right now, I paraphrase here:

Everyone agrees that raising efficiency in the economy is a good thing. But if some Japanese companies currently in a management crisis are allowed to go bankrupt, there would be no net efficiency gain because there’s a chance they could right themselves. For a company to go bankrupt and out of business not only harms the managers and employees, it can have an even bigger impact on the macro economy. Letting companies fail destroys more than the of the firms’ collective employees, plant and equipment, it also destroys the built-up knowledge of an organized entity that is more than the sum of its parts; specifically, their organizational strengths and customer bases. These elements have been overlooked by traditional microeconomics, but they are critical elements of business. Once destroyed they are not easily restored.

It should be possible to encourage firms to transition their businesses without bankruptcy by pushing them to expand into related fields. This would maintain manager and employee morale while simultaneously boosting the overall economy.Though obvious sectors for these transitions would be green technology, biotech, or nursing/welfare, companies should be left to decide their new businesses on their own. It might take a long time for companies to turn around and succeed like Toray or Asahi Kasei.

Therefore, the government should make it a priority to provide tax incentives and subsidies to these sorts of companies.

As much as I usually trust op-ed writers who are refuse to go on the record, does anyone else smell a conflict of interest here? Something tells me the author (pen-name: 真和) has a specific company on the tip of his tongue but just can’t bring himself to say it.

I am flying to the US next Friday for a two-week trip around the East Coast, stopping in New York, Philadelphia, Washington and Myrtle Beach. One of my biggest helpers in planning this trip has been a website called TripIt.

I generally use Google Calendar for planning my schedule, and as long as I stay in Japan, it works just fine. My Windows Mobile phone automatically syncs to Google and displays upcoming Google Calendar events on its Today screen. But there is a serious drawback to Google Calendar: its assumption that the user will always stay in the same time zone.

Let’s take my flight from Narita to JFK, ANA flight 10. It leaves Narita at 11:00 AM JST, and arrives at JFK at 10:45 AM EST on the same day (thanks to the International Date Line). If I stick to local time on my calendar, it’s impossible to input this flight unless I create two separate events for arrival and departure. Even if I do that, my calendar will still assume that I am on Japan time no matter where I go, so it will assume that I have already arrived even when I am hours away from arriving.

Enter TripIt. It was designed as a socially-networked travel tool; you put your upcoming trips online and it tells you who else will be in your destination with you. I find this particular function to be pretty worthless, but the real beauty of TripIt is in calendaring trips that go across multiple time zones. Here’s why:

The TripIt web page always shows the itinerary in local time. You can specify departure and arrival time zones for each mode of transportation you take. This is perfect for planning each step of the itinerary.

Each account has an iCal feed which you can use to automatically reflect your travel plans in Google Calendar, iCal or any other modern calendar app.

The feed shows up in whichever time zone your calendar reader is set to. While I am planning my trip in Tokyo, all the times show up in Google Calendar in Tokyo time, which comes in handy for figuring out when to sleep so I can minimize jet lag. Once I am on the plane to the US, I can switch my phone to Eastern Time and all the events will convert to Eastern Time.

Automated input keeps this from being a pain in the butt to set up. All you have to do is forward your airline, Amtrak and hotel confirmations to a special e-mail address, and TripIt parses your travel plans into your calendar automatically.

Thanks to the authors of this web site for solving my problems–now I’m ready to enjoy sweltering weather, greasy food and panhandlers again!

On July 12 the Tokyo Legislative Assembly elections will be held. While the TLA does not appear to do much in the grand scheme of things, this election is personally important to me as it will mark my first experience with an election where Mrs. Adamu can actually cast a ballot (in previous elections she could not vote for one reason or another). With that in mind and in the interest of being an informed voter’s spouse, I decided to take a look at what this is all about with a focus on Adachi-ku, the ku I call home.

How is the assembly chosen?

With 127 members (one representing roughly 100,000 people), Tokyo’s legislature is the nation’s biggest local assembly of any kind. Members come from 43 mostly multi-member districts and are elected all at once to four-year terms using the single non-transferable vote system similar to the Lower House elections prior to 1994. For example, in Adachi-ku’s case, voters choose an individual and the top six vote-getters win seats. The 42 districts consist of the 23 cities or “ku,” 18 cities within the prefectural boundaries, and one to cover all the outlying islands. Adachi-ku, where I live, is allotted six seats.

Most local elections in Japan are held all at once every four years in what are called the “unified local elections” (統一地方選) (the last round was in 2007), but Tokyo’s are held two years after that. They used to sync with the rest of the country, but the schedule got screwed up in 1965 when an LDP bribery scandal spurred leftist parties to push for a recall, leading to a voluntary dissolution and early election.

Currently, the LDP-New Komeito coalition maintains an overwhelming majority of seats (with a respective 48 and 22 members each), followed by the DPJ with 22 members, 13 Communists, and single-digit membership from the left-leaning Tokyo Seikatsusha Network and unaffiliated politicians.

What do they do?

In typical assembly fashion, they are responsible for passing local ordinances (条例) and approving the prefecture’s budget, which at 6 trillion yen just for the general account is on par with Finland’s GDP.

The prefectural assembly’s other enumerated powers according to the Tokyo Prefectural Assembly website include investigating and auditing the executive branch, passing a no-confidence motion against the governor, and responding to requests from Tokyo residents to investigate various grievances.

What are some of their more recent achievements? How powerful are they?

Since Tokyo’s government is set up somewhat similarly to a US state (unicameral legislature and a fairly powerful directly elected governor), the assembly can wield significant power if the party/coalition holding a majority of seats is opposed to the governor’s agenda. However, this is not currently the case, so right now they don’t do much.

News outlets openly report that the assembly is all but a rubber stamp for the executive, owing to a comfortable relationship with recent cozy LDP-Komeito majorities (and occasional DPJ cooperation) and three consecutive terms for Governor Shintaro Ishihara, who is not officially backed by any party but has an ideological affiliation with the LDP-Komeito as one of Japan’s leading conservatives. Prefectural assembly meetings are perfunctory affairs in which the elected members simply read from a script which has been prepared in advance by bureaucrats from the governor’s office, a process euphemistically called nemawashi i.e. backroom dealing. The Communists and other leftist parties do their best to stir up scandal (Ishihara’s lavish trips abroad and the catastrophic small-business bank among them), but voters keep voting in this conservative bloc.

Most of the assembly’s routine agenda appears to be fairly mundane, except when they are called on to give their blessing to the pet projects of either Governor Ishihara or the national government. A look at the agenda of assembly meetings in 2009 shows such typical local administration as minor revisions to health service fees, approval of staff rosters for the fire departments, and the establishment of a new police precinct. However, it is unclear how much room for originality the prefecture has when they must contend with the agendas of the Tokyo prefectural bureaucracy (firmly controlled by Governor Ishihara) and the prerogatives of the internal affairs ministry.

In May, the prefecture passed an emergency supplementary budget to provide economic stimulus in coordination with the central government’s efforts. They approved spending of 134.9 billion yen (with about half the funding from the central government, with the rest paid for by revenues from prefectural revenues and a bond issue). The money went to beef up a consumer protection agency, subsidize day-care centers, pay additional outlays to pregnant women, fund high-tech education, and more.

A 2007 report from citizen journalism site JANJAN decried the governor’s strong influence over the prefectural government, owing not only to the majority LDP-New Komeito who form a loyal right-wing support base thanks to their alliance in national politics, but also to a compliant DPJ. For example, the legislature is in charge of regulations/zoning of prefecture-run wholesale markets, and this includes the world-famous Tsukiji fish market. A decision made in 2001 to move the market to Toyosu, where more modern facilities can be constructed, met with opposition at the last minute due to claims of pollution at the new site in Toyosu. However, the assembly members were not hearing it and the move remains on schedule for 2012.

In another example of Ishihara’s absolute control over his pet projects, the Tokyo legislature gained national attention recently for approving multiple bailouts of New Bank Tokyo (新銀行東京). This bank was created as the fulfillment of Ishihara’s campaign promise to start a bank for small Tokyo-based companies during a bid for reelection in 2002. After opening for business in 2004, just three years later the bank became insolvent due to notoriously lax lending standards that led to enormous losses from the very beginning. But despite this embarrassing failure, the Tokyo assembly was unwilling to refuse Ishihara’s insistence on providing the bank with 4 billion yen in new capital and a new lease on life. In this instance the DPJ members opposed the bailout but it passed with LDP and Komeito support.

The media outlets reporting these scandals seemed genuinely frustrated with the assembly for these recent scandals, but it seems like they should save their breath for the governor’s office, because once Ishihara has made up his mind the TLA won’t do much to stop him.

Other so-called “third sector” businesses directly run by Tokyo Prefecture include the “Toei” subway lines and buses and prefectural government housing.

What are the issues in this election?

There are none. If you have heard anything about this upcoming election, it is probably that a poor showing by the LDP could spell trouble for Prime Minister Aso’s government and could trigger an early election (latest reports are that Aso might just dissolve the Lower House before the prefectural elections. Not even the Tokyo Shimbun could identify an angle outside of whether the LDP-Komeito coalition can hold onto power. I’ll go into more detail on the candidates themselves later, but their pledges tend to focus on populist rhetoric like helping small businesses, cutting income taxes, and lowering medical fees.

Otherwise, interest in the election is fairly low (but higher than a typical US election). The last election in July 2005 boasted a mere 43.99% turnout, which falls somewhere among the typical turnout of 40-50%.

***

OK, that’s enough for now. Next time I will try and profile the candidates in the election and see if it makes a difference.

I bought and enjoyed Pepsi Shiso for the first time today (it went on sale on Tuesday). I’m a big fan of the shiso leaf flavor and have enjoyed shiso juice that I’ve bought in the inaka wilderness of both Hokkaido and Kyushu. I LOVE the new soft drink, and would recommend it to anyone who enjoys the general adventures that can be enjoyed in Japanese nutty snack cuisine.

Unfortunately, it’s a kisetsu gentei drink and will only be sold through the summer. And for those of you who think that Pepsi is some amazing cross-cultural mastermind of Japanese tastebuds, this is actually the brainchild of Suntory Foods, which has wholly owned Pepsi Japan since 1998.

All this being said, you’re going to have to like the taste of shiso to enjoy the drink. But if you love shiso, you’ll love Pepsi Shiso. Want to see a comparison of the color of Pepsi regular and Pepsi Shiso? Check out this photo.